Oman vows to create 25,000 jobs

Oman copy

Bloomberg

Oman pledged to create 25,000 public sector jobs by December, a move that risks adding to a budget gap that was the Gulf’s widest last year.
The government will follow up with additional measures to address the lack of jobs in the sultanate, the state-run Oman News Agency reported on Wednesday, citing the cabinet’s decision a day earlier. Unemployment was 17.5 percent in 2016, according to the World Bank. The move has echoes of the government’s pledge to create 50,000 jobs in 2011. Six years on, the economy is the trigger. Oman’s budget deficit was about 21 percent of gross domestic product in 2016, the highest in Gulf Cooperation Council, according to International Monetary Fund data. Its gross debt ratio was almost three times that of Saudi Arabia.
The hiring plan could spur private consumption amid slow growth in the non-hydrocarbon sector, said Carla Slim, an economist at Standard Chartered in Dubai. She expects Oman’s 2017 budget deficit to exceed the government’s target of $30.4 billion, though higher oil prices this year should narrow the deficit relative to 2016.
“It’s a tough balancing act for the sultanate, and I can see why weakening growth and ready access to funding would encourage the authorities to spend,” said Simon Williams, HSBC Holdings Plc’s chief economist for central and eastern Europe, the Middle East and North Africa, adding that the government’s financial
position should give it pause.

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